Taxpayer subsidies for NC frackers?

This week North Carolina Gov. Pat McCrory (R) signed into law a bill that opens up the state to fracking for natural gas. The Energy Modernization Act will allow drilling permits to be issued 61 days after the state Mining and Energy Commission approves final rules for the industry, which is expected to happen by next summer.

The new law breaks a pledge from legislators that they would review and approve the rules before the state’s drilling moratorium could be lifted. Environmental advocates also criticize the law for failing to adequately address the risks associated with fracking and for weakening safeguards. Supporters claim it will boost North Carolina’s economy.

But it turns out that North Carolina’s Republican leaders are now seeking taxpayer-financed “corporate welfare” for the oil and gas industry — even though the five biggest drilling companies alone hauled in $93 billion in profits last year. As The News & Observer of Raleigh reports:

* The state Senate’s proposed budget includes nearly $1.2 million to help the energy sector with drilling, analysis and marketing.

* McCrory’s proposed budget includes $500,000 for drilling up to three test wells in Lee County, part of the state targeted for fracking.

* A separate $550,000 initiative was approved last year to help the energy industry assess fracking prospects.

The new fracking law also calls on the state to conduct taxpayer-financed studies on locating a liquid natural gas export terminal on the North Carolina coast, establishing a curriculum to train drilling industry workers at Central Carolina Community College, and developing infrastructure to facilitate oil and gas development such as pipelines, compressor stations, and gas processing systems. In addition, it prohibits local governments from imposing taxes on gas produced in their jurisdictions.

This appears to be the direction in which North Carolina’s current political leadership is headed: spending public dollars on a highly profitable industry that imposes significant social costs, including health-damaging water and air pollution. Fracking also releases significant amounts of methane, a potent greenhouse gas that contributes to climate disruption — a serious concern for a coastal state like North Carolina that’s vulnerable to sea-level rise and intensifying tropical storms.

“The state has already spent significant resources in pursuit of fracking, with no new jobs to show for it (beyond the state government staff hired to write the new rules),” NC Conservation Network Policy Director Grady McCallie wrote in his analysis of the new law. “If the legislature had spent a fraction of these resources on renewable energy and efficiency, we would already be seeing the payoff in jobs and income for North Carolinians.”